South Korea's Economic Growth Slows to Weakest Rate in Six Quarters

Political turmoil and declining consumer confidence weigh heavily on South Korea's economy, with Q4 GDP growth missing forecasts.

South Korea's GDP grew by just 0.1% in Q4 2024 compared to the previous quarter, the weakest rate in six quarters and below expectations of 0.2%.
For the full year 2024, the economy expanded by 2%, slightly under the 2.1% forecast, with political instability and reduced domestic demand cited as key factors.
The brief declaration of martial law by impeached President Yoon Suk Yeol in December 2024 significantly impacted consumer sentiment, which fell to its lowest level since the COVID-19 pandemic.
Export growth, a traditional driver of South Korea's economy, rose by 6.9% in 2024, but fears of potential U.S. trade tariffs under President Donald Trump loom large.
The Bank of Korea has revised its 2025 economic growth forecast downward to 1.6-1.7%, citing ongoing political instability and weakened domestic demand.